India’s annual food inflation rises further to 16.44 percent

New Delhi, Sep 30 (Calcutta Tube) India’s annual food inflation rose further to 16.44 percent for the week ended Sep 18, compared to 15.46 percent the previous week, as heavy rains and floods in parts of the country disrupted the supply of essential food items.

The barometer for food prices has been on the rise from Aug 14, when it was at 10.05 percent. In just over a month, it has increased by 6.4 percentage points.

A heavy monsoon spell and flooding in states like Haryana, Punjab, Uttar Pradesh and Uttarakhand have hit the supply of food grains and essential items.

The annual inflation rate for the primary articles group also rose at a faster pace of 18.31 percent, having been at 16.8 percent during the week ended Sep 4.

The index for fuels, however, rose at a slower rate of 10.73 percent during the week ended Sep 18, compared to 11.48 percent in the previous week.

The government Sep 14 shifted the base year for the official wholesale price index to 2004-05, from the earlier 1993-94, and added as many as 241 new items to its basket of commodities. The weightage for individual commodities were also altered.

Both the weeks under review were calculated according to the new base year.

The rise in food prices will again strengthen the case for the Reserve Bank of India to tinker with the monetary policy to tame prices.

The RBI earlier this month had hiked its short-term borrowing and lending rates by 50 basis points and 25 basis points respectively.

The following are the rise and fall in prices of some of the main commodities that form the sub-index for food articles over the past 52 weeks:

Cereals: 6.11 percent

Rice: 4.05 percent

Wheat: 9.14 percent

Pulses: 5.94 percent

Vegetables: 5.87 percent

Fruits: 15.13 percent

Milk: 24.32 percent

Potatoes: (-)50.48 percent

Onions: 1.39 percent

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